ABI: 'Act of God' is an urban myth

The Association of British Insurers has rejected claims that insurers are relying on an “Act of God” clause to refuse travel insurance claims connected to the Icelandic ash cloud, describing it as an "urban myth."

The ABi's director of general insurance and health, Nick Starling, said: “Insurers are responding to a significantly increased volume of calls and customers should be aware they may have to wait longer than usual. Priority will be always given to those with health emergencies. Calls that are meant for airlines or tour operators are being redirected as appropriate.

“For single-trip policies, all insurers will automatically extend the period of cover for those who are currently stranded abroad. This is typically up to a period of one month. For those who are still in the UK and have rearranged travel plans the policyholder can have their policy amended at any time before the new departure date and should contact their insurance provider to arrange this.

“While a volcanic eruption is not a specific insured event covered in insurance policies, some cover for delay and travel abandonment may be available, depending on the level of cover purchased by the policyholder and the terms and conditions. This will vary as there is no standard travel insurance policy. Payment for delay, whether outward or return, is usually a fixed amount per delayed period up to a maximum figure, not an open-ended sum."

He added: “It is especially important to talk to your insurer to determine the types of expenses which can be covered before you incur them.

“It is an urban myth that insurers are relying on an “Act of God” clause to get out of providing cover for this event. Where this event is not specifically covered by your insurer some are offering ex-gratia payments for customers stranded abroad.

“For any traveller including those who have a journey approaching and are due to travel to or from a UK airport the first thing you should do is contact your airline or the airport you are travelling from to find out the latest information regarding your travel arrangements.”